This copy is for your personal non-commercial use only. To order presentation-ready copies of Toronto Star content for distribution to colleagues, clients or customers, or inquire about permissions/licensing, please go to: www.TorontoStarReprints.com

Given how little was expected of the November 2010 national elections, events in Burma are startling. Among them, Nobel laureate Aung San Suu Kyi’s house arrest ended. More than 200 political prisoners were released. U Myint, a respected economist associated with the opposition, was appointed the government’s chief economic adviser. Press and Internet restrictions have eased. The prospects for that beautiful, but badly tarnished nation are more promising than they have been for decades.

Maybe the Burmese government is simply doing the right thing, but reality is always complicated. The decision to suspend its multi-billion-dollar Myitsone hydroelectric project with China is more revealing of its motivations. Extremely controversial for environmental reasons, the project serves as a lightning rod for anti-Chinese sentiment among Burmese who feel China’s embrace has become too tight. China is Burma’s largest trading partner and the primary destination for Burma’s vast natural resources, which many fear are being rapidly depleted. Chinese consumer products dominate the Burmese market and 30 to 40 per cent of Mandalay, Burma’s commercial hub, is now Chinese. The government, too, appears concerned that its historical non-alignment may be jeopardized.

If its actions were an attempt to catch the eye of the United States to counterbalance China’s influence, then the strategy clearly worked. Hillary Clinton’s visit this month was the first by an American secretary of state since 1955. It is uncertain, however, whether the measures signal profound change or are merely cosmetic. Despite suspending the Myitsone project, ties with China remain varied and strong and there have yet to be signs of reforms designed to improve the health care, education or economic well-being of ordinary people.

Why would the United States respond so eagerly to what might be considered rather minimal reforms? Three reasons related to American interests in Asia present themselves.

First, the United States needs to strengthen its presence given the growth of Chinese economic power and influence. President Barack Obama announced in November that the United States is a Pacific power and is “stepping up its commitment to the entire Asia-Pacific region.” This is widely perceived to be a response to China’s growing presence throughout the region.

Article Continued Below

Second, Burma stands at what Thant Myint-U calls the “new crossroads of Asia.” As the land between India and China, Burma is likely to grow in strategic significance as these emerging powers compete.

Third, the United States is concerned by reports of Burma trading rice with North Korea for the advanced military technology it believes it needs to protect its sovereignty. Containing North Korea remains an American priority.

Whatever Burma’s and America’s respective underlying motivations, the present also offers a rare opportunity to improve the lives of Burma’s citizens. The Burmese government must be convinced that it can achieve security better through a prosperous and open society than one that is closed and poor. It should seize this moment to concentrate on economic development, not armament. It is here that the United States and the West have the most to offer.

Economic development is increasingly perceived as being dependent on the quality of a country’s institutions. Just as roads, telecommunications and electricity form part of a country’s physical infrastructure, its matrix of policies, laws and institutions create an enabling environment through which governments can foster growth. A country’s institutions interpret, administer and enforce policies and laws. The justice system, for example, needs impartial courts. Unfortunately for Burma, its civic institutions have been long neglected or actively dismantled. If Burma wishes to reintegrate with the world it must be willing to accept, and the West must be prepared to offer, help in restructuring its institutions.

The experiences of Burma’s neighbours, Singapore and Penang, Malaysia, serve as helpful examples. An independent Singapore was initially considered unlikely to be economically viable, while Penang was called a dying fishing village in the mid-1960s. With the aid of foreign expertise, comprehensive reports were prepared analyzing their respective economies. The reports focused upon how to identify and seize economic opportunities, not which sectors to develop. Singapore and Penang adopted policies and created institutions to promote exports through attracting foreign investment. Today, Singapore is among the world’s wealthiest nations and Penang is the fulcrum of Malaysia’s vibrant electronics sector. Burma may consider following a similar path.

If Burma wishes to reintegrate into the global community, its ability to create institutions to implement its social, political and economic policies will be critical. The key institutions will depend on its development priorities. Good institutions cannot be created overnight; the process is arduous and can take a generation. Properly done, the results can be dramatic and enduring. Now is Burma’s time to rebalance its strategic and economic goals.

Mitchell Wigdor is a Toronto-based lawyer who has travelled frequently to Southeast Asia since 1984, when he first visited Burma. He is author of the forthcoming No Miracle: What Asia Can Teach All Countries About Growth.

The Toronto Star and thestar.com, each property of Toronto Star Newspapers Limited, One Yonge Street, 4th Floor, Toronto, ON, M5E 1E6. You can unsubscribe at any time. Please contact us or see our privacy policy for more information.

More from the Toronto Star & Partners

LOADING

Copyright owned or licensed by Toronto Star Newspapers Limited. All rights reserved. Republication or distribution of this content is expressly prohibited without the prior written consent of Toronto Star Newspapers Limited and/or its licensors. To order copies of Toronto Star articles, please go to: www.TorontoStarReprints.com